Following descriptions are the examples of substantive testing EXCEPT:

A) Test of account balances to verify the correctness of the amounts

B) Verification that an operating system and/or applications are configured appropriately to the companies needs

C) Review of minutes of directors; meetings and inquiry

D) Use of statistical sampling to determine the accuracy of financial statement figures

Right Answer is the option "B"

6)

How often Inventory levels should be checked against the inventory records in order to keep its control effectively?

A) Rarely

B) Periodically

C) Never

D) Daily

Right Answer is the option "B"

7)

What auditors seek in the register of non current assets for each major group of assets?

A) Details of each item its cost and residual value

B) Details of each item its cost and accumulated depreciation

C) Details of each item its cost and depreciation

D) Details of each item its cost and capital investment expected returns

Right Answer is the option "C"

8)

Which one of the following may not be any matter relevant to verification of assets?

A) Taxation

B) Vouching

C) Insurance

D) The letter of representation

Right Answer is the option "B"

9)

An Automobile Company hires auditors at the year end. Auditors are at the stage of verification and vouching of company financials. Before examining the equity section they develop general aspects concerning the owner equity. In your opinion which one of the following aspects may NOT be considered by the auditors during this assessment?

A) Share capital is properly classified and described in the accounts

B) Capital stock is enough to execute the company financial needs

C) Reserves are properly classified and presented

D) Movements in reserves are properly authorized

Right Answer is the option "B"

10)

Non current assets manufactured or constructed by the company itself should reflect which types of costs in the costing records?